A.M. Best Places Credit Ratings of Certain Subsidiaries of HDI Haftpflichtverband der Deutschen Industrie V.a.G. Under Review

A.M. Best has placed under review with positive implications the Long-Term Issuer Credit Rating (Long-Term ICR) of a- of Talanx AG (Germany), the intermediate holding company of HDI Haftpflichtverband der Deutschen Industrie V.a.G., and the Long-Term Issue Credit Rating (Long-Term IR) of a debt instrument issued by Talanx Finanz (Luxembourg) S.A., and guaranteed by Talanx AG. Concurrently, A.M. Best has placed under review with developing implications the Financial Strength Rating of A (Excellent) and the Long-Term ICR of a+ of Talanx Reinsurance (Ireland) SE. (See below for details on the Long-Term IR.)

The Credit Rating (rating) actions follow the announcement that Talanx AG, in pursuance of greater efficiency for the groups internal reinsurance structure, recently applied for a reinsurance license to start writing business in 2019.

As part of the groups new target operating model, Talanx AG is expected to become the main risk carrier for most of the internal non-life reinsurance treaty cessions (excluding facultative) with effect from 2020 onwards. Following regulatory license approval, the company’s status will change from the groups non-operating holding company to an operating holding company. The positive implications reflect A.M. Bests expectations that the company will broaden its revenue sources, further improving financial flexibility that will lead to an increased ability to service ongoing and prospective obligations.

The groups new reinsurance structure also is expected to result in changes for Talanx Reinsurance (Ireland) SE the groups subsidiary currently acting as the intra-group non-life reinsurer. A.M. Best will reassess the companys strategic importance and prospective role within the group as soon as further information is provided.

The latest rating action follows an accepted appeal from Talanx Re, under which new information was provided that enhanced A.M. Bests opinion on the role of the Irish reinsurer as part of the wider groups strategy.

A.M. Best expects to resolve the under-review status of the ratings once the license has been approved by the German regulator and a full assessment of the impact of the changes has been completed.

The following Long-Term IR of bbb+ has been placed under review with positive implications:

Talanx Finanz (Luxembourg) S.A. — EUR 500 million 8.367% subordinated fixed to floating rate notes, due 2042

This press release relates to Credit Ratings that have been published on A.M. Bests website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Bests Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Bests Credit Ratings. For information on the proper media use of Bests Credit Ratings and A.M. Best press releases, please view Guide for Media – Proper Use of Bests Credit Ratings and A.M. Best Rating Action Press Releases.

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